By Chibuike Oguh

(Reuters) -Global equities fell and U.S. Treasury yields rose on Wednesday after the Federal Reserve’s meeting minutes showed that officials were ready to slow the pace of interest rate hikes in tandem with signals of a slowdown in inflation.

In their July meeting minutes released on Wednesday, Fed officials said the pace of future rate hikes would depend on incoming economic data, as well as assessments of how the economy was adapting to the higher rates already approved.

After the release of the minutes, traders of futures tied to the Fed’s policy rate saw a half-percentage-point rate hike as more likely in September given recent economic data showing a moderation in inflation. U.S. consumer prices were flat while producer prices fell in July.

“Overall, the minutes read a bit dovish,” said Sean Bandazian, senior investment analyst for Cornerstone Wealth in Charlotte, North Carolina.

“There was a lot of language about slowdowns in different areas but also several mentions about how strong the labor market is. They are keenly aware that there are several areas of the economy that are slowing. Let’s remember that these minutes are a bit stale – they are from a meeting that was prior to the decelerated CPI and an extraordinarily strong jobs report that came in for July.”

MSCI’s gauge of stocks in 50 countries across the globe shed 0.62%. In Europe, stocks closed down nearly 1%, breaking a five-day winning streak after data showed U.K. inflation exceeded 10%.

U.S. Treasury yields advanced on lingering inflation concerns even as some investors saw minutes of the U.S. Federal Reserve’s July meeting as officials’ taking a less aggressive stance on inflation.

Benchmark 10-year yields dipped about two basis points after the minutes were released while two-year note yields fell by about five basis points from 3.335% to 3.285%. Still, they closed higher, at 2.894% and 3.293%, respectively.

“The report read dovish and in the post minutes, yields have fallen, risk assets and equities moved higher and a lot of that comes from a bit of repricing in the September odds for a 50 basis point hike versus 75 basis point hike. It’s now skewed to the markets believing there’d be a 50 basis point hike,” Bandazian added.

On Wall Street, major indexes sharply cut their losses after the release of the minutes although stocks still closed down driven by a selloff in equities in technology, consumer discretionary, industrials and communication services.

The Dow Jones Industrial Average fell 0.5% to 33,980.32, the S&P 500 lost 0.72% to 4,274.04 and the Nasdaq Composite dropped 1.25% to 12,938.12.

Oil edged 1% higher after earlier hitting a six-month low on Wednesday, as a steeper-than-expected draw down in U.S. crude stocks outweighed concerns over rising output, Russian exports and recession fears.

Brent crude was up 1.35% at $93.59, up a barrel, while U.S. West Texas Intermediate (WTI) crude rose 1.71% to $88.01 per barrel.

The U.S. dollar pared its gains following the Fed’s meeting minutes. The dollar index rose 0.141%, with the euro up 0.08% to $1.0178.

Gold prices rebounded but were still lower. Spot gold dropped 0.8% to $1,760.88 an ounce, while U.S. gold futures fell 0.30% to $1,767.80 an ounce.

(Reporting by Chibuike Oguh in New York; Editing by Richard Chang, Barbara Lewis and Diane Craft)